Why is Cost-Benefit Analysis Important for Entrepreneurs?
Entrepreneurs often operate under conditions of uncertainty and limited resources. Conducting a CBA helps in:
Assessing Risks: Entrepreneurs can identify potential risks and their financial implications, thereby making better-informed decisions. Resource Allocation: Helps in optimizing the allocation of resources to achieve maximum returns. Strategic Planning: Facilitates long-term planning by forecasting future benefits and costs. Stakeholder Communication: Provides a clear rationale for decisions, making it easier to communicate with investors, partners, and other stakeholders.